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The long-term unemployed will be guaranteed a job under new proposals from the Labour party.

If it is re-elected into government, it said it would cut pension tax relief for high earners in order to secure work for those who have been without it for extended periods.

Those earning more than £150,000 a year would see their tax relief slashed under the proposals.

The £1 billion scheme could see almost 130,000 people who have been out of work for more than two years offered posts on at least the minimum wage, according to shadow chancellor Ed Balls.

If they refuse to take the jobs offered to them under the proposed scheme, they could lose their benefits.

In a statement on the Politics Home website, Mr Balls said: ‘A One Nation approach to welfare reform means government has a responsibility to help people into work and support those who cannot, but those who can work must be required to take up jobs or lose benefits as a result – no ifs or buts.

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‘While getting people back to work will save the taxpayer money in the long-term, the upfront costs of Labour’s jobs contract can be funded by reversing the Government’s decision to stop tax relief on pension contributions for people earning over £150,000 being limited to 20%.’

Under the scheme, the long-term unemployed would be offered 25 hours of work a week for six months.

Ed Balls has promised jobs for all long-term unemployed (Picture: PA)

Mr Balls added: ‘When times are tough it cannot be right that we subsidise the pension contributions of the top 2% of earners at more than double the rate of people on average incomes paying the basic rate of tax.

‘£1 billion a year would fund a compulsory jobs guarantee initially for all those out of work for 24 months or more – which we would seek to reduce to 18 or 12 months over time.’

Those earning more than £150,000 would only get 20% relief on savings for their retirement, rather than the 50% maximum available now, and 45% per cent from April.

The proposal is similar to one announced by the Labour government in 2009, which was later scrapped by the coalition.